Strong price rises seem to have thrown off many prospective buyers lately, particularly first home buyers. Their struggles, alongside the idea that cashed-up investors are crowding auctions, have contributed to an ongoing story line of Sydney’s property boom. But is it a boom across the board?
According to the Real Estate Institute of New South Wales president Malcolm Gunning, the idea of a boom market isn’t all that it seems.
“The reality is that all areas of the residential property market are not booming,” says Gunning. “The majority of the boom we are seeing is at entry level, which is pricing first home buyers out of the market in the Sydney metropolitan area as well as Wollongong and Newcastle.
“Properties in the affordable prestige market, starting at around $2m, are only now beginning to see signs of recovery. Renewed business confidence and the green shoots of a strengthening NSW economy mean that there are opportunities for those hoping to enter the affordable prestige market.”
This at least bodes well for those who can afford to deal at the upper end of the property market because according to Harvey, Sydney’s market doesn’t traditionally drop or ‘correct’ much. He does expect the market will rise all year but eventually plateau once the talk turns to interest rate rises again.
Homeowners need their own strategy
For homeowners looking to move right now, the rising market presents its own set of challenges. Director of EPS Property Search, Patrick Bright says because prices are rising quickly it’s important to avoid the trap of selling before you’ve found a new home.
In this type of market it’s best to buy before you sell but only after you know what your current home is worth, says Bright.
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